KARACHI: As the fate of both provincial and federal government-funded transportation projects remains uncertain amid the widening gap between demand and supply of adequate transportation facilities, international players are seeing great opportunities in Karachi to expand their businesses.
This time round, a Chinese tech giant is set to launch wide-ranging operations in Karachi, including delivery and ride-hailing cab services, with plans to invest $600 million in the country, officials and market sources said.
These sources said that, after first setting foot in Islamabad, the Chinese firm Timesaco is now set to expand its Tatu Mobility operations to Karachi, with initial plans to launch two services this month, thereby adding to several existing ride-hailing services being operated by some half a dozen technology companies across the city.
The company, however, claims that its services will be different from the already existing operators on a variety of fronts.
“Tatu Mobility has already launched its online cab service in Islamabad and Rawalpindi with name of Timesaco,” said Donald Li, the founder and the CEO of the company. “Tatu Mobility is going to start its operation in other cities as well. Tatu Mobility will start online cab service and digitisation of current transportation network in Pakistan. We are set to launch our service in Karachi this month.”
Firm to invest $600m in Pakistan
In the first phase, Mr Li said, the company plans to launch its online cab service and system for digitising the existing transport network, following which it plans to also introduce its commute and delivery service later this year.
When asked what opportunities the city offers and how any new operator could survive amid growing competition in an environment where there are already several players racing to win their share, he referred to some offers the Chinese company was planning to extend to its business partners that would set it apart from the others.
“Tatu Mobility offers 97 per cent share of earning to its drivers or captains of online cab service,” said Mr Li. “Other companies are offering 70pc to 75pc. We are facing competition but our focus is not just on the profit side; Tatu Mobility wants to restructure and digitise the current transport system. In its initial phase, Tatu Mobility intends to invest $600 million in Pakistan and gradually investment will be increased based on the market.”
The keen interest of the private sector and business giants prove that there are immense opportunities when it comes to transport service in Karachi.
This relatively untapped market, coupled with a public-sector transport system that is in a state of virtual collapse, has motivated these organisations to expand operations in Karachi, with new projects still in the pipeline.
However, experts believe that besides facilitating private businesses in the area, there is still a gap that can be filled by the public sector transport service.
“Till 1996, this city was witnessing operations of both private sector and the government buses under the Karachi Transport Corporation,” said Prof Dr Noman Ahmed, chairman of the Department of Architecture and Planning at NED University of Engineering and Technology.
“There were obvious reasons for the closure of the KTC, but for a very good number of years both sides — the government and the private sector — kept serving the transport sector collectively. The government still cannot only regulate the transport business, it can also bring its share for the people of Karachi, because good and easy [to access] transport services at cheaper rates are still largely needed.”
Published in Dawn, March 6th, 2020